Before its sharp decline on June 7, Bitcoin’s volatility had been approaching historic lows, with the 15 days leading up to the drop marking one of the calmest periods in its history.
Historic Low Volatility
Between May 24 and June 7, Bitcoin’s price movement was so minimal that it was within the bottom 6% of all 15-day periods for volatility, according to Rapha Zagury, chief investment officer at Swan Bitcoin. During this period, Bitcoin traded within a 7% range, fluctuating between $66,936 and $71,656. Zagury noted in a June 7 post on X that the latest 15-day rolling volatility number was 23%, nearing the lower end of historical volatility levels.
Sharp Decline Triggered by Employment Report
On June 7, Bitcoin’s price dropped by 3.33% to $69,264 following the release of the U.S. Employment Situation Summary Report, which showed stronger-than-expected job growth. This data suggested that the Federal Reserve might not cut inflation rates on June 11, a metric closely watched by analysts for Bitcoin price predictions. At the time of publication, Bitcoin was trading at $69,246.
Also Read: Bitcoin Return to $71K Could Liquidate $1.38B in Short Positions
Historical Outcomes of Low Volatility
Zagury highlighted the outcomes of Bitcoin’s price movements during previous periods of similarly low volatility. Over the next 30 days following such periods, the average return stood at 20.95%, with the minimum return declining by 32.06% and the maximum return reaching 218.40%.
When viewed over the course of 365 days after low-volatility periods, the minimum return was 55.59%, while the average return soared to 820.82%. Zagury emphasized that while past performance is not an indicator of future results, understanding historical trends can provide valuable insights.
